Beyond Stocks and Bonds

How financial advisor Mary Deatherage builds a core portfolio and where she's finding alternative investments to spread the risk.

This transcript has been automatically generated and may not be 100% accurate.

I ... where should you be investing beyond stocks and bonds and Jack Otter and her Barron's dot com ... on your married efforts is a private wealth manager at Morgan Stanley ... aam marry ... you obviously in Best CA for your clients in stocks and bonds but you've also got some other interesting ideas ... let's start with a whole pot of the stock allocation were DC suffered a ... I think the stock market's fairly valued ... that doesn't mean that is going to move from here ... so you just have to tread carefully ... having said that ... BA Dividend Nielsen the SNP are higher than what you can get a bond market these days so ... the risk capital is worse the consideration and thinking about how much risk you can really Campbell a portfolio ... no the bond market aam resuming that you you want some exposure to bonds for clients on where you funding under the pockets of the bond market to look more attractive than others ... odds are pretty tricky these days ... I don't think anybody's the wife who seemed bonds of zero percent interest rates the way we have today ... so we've been looking at short-term bonds and a lot of non traditional bonds for example ... whether looking at high yield the Global on distressed debt can be very interesting cuz at least you get paid well what you waiting for the market to recover ... there's a law to differ ways to go app that ... will do upon to ration study for clients so we look at the sensitivity to interest rates in a bond portfolio security by security ... has been a lot of out wires that pop out and say gee if interest rates go up ... this security may go down a lot we don't want us ... sure so on the stocks and bonds now and talk about we are finding other opportunities to spread risk possibly get some real return on what areas you consider alternative investments are worth investing ... be on what people think of as hedge funds that may have the K one until liquid is harder to see ... most American investors can get easy access to what I'll call nontraditional growth or nontraditional income ... through neutral funds through TT apps ... and we spend a lot of time talking to clients about their risk capital ... a and ... and really diversifying satellite in a round of what you think of is for traditional Essen P five hundred where your international markets ... so that might include things like real estate ... aam water as a concept ... of emerging markets I consider to be non traditional ... as most Americans are really the comparable with that but it fits the portfolio do with emerging market equities or bonds has acted right so you can get emerging market debt or Mergermarket equity ... um ... did their initial finds that you can buy that will go a long or short an initial in the market ... so ... there's a lot of varieties of things that are just kind of ... just different enough that they should compliment the risk ... of being traditionally and ... say the Essen P five hundred the international markets ... so the benefits here are one you hope for some real return from the end but also by the first to find her clients presumably ... if things go wrong the stock or bond market is not something else that might soon when the rest the photos that I ... like their new stuff was actually short the market ... maybe not short the market overall but short stocks they don't like ... and always tell people is like the Canary in a mine shaft ... this will be an indication that when the market goes down will be going up and this one piece the portfolio ... but because this is authentic cuz ... hopefully it hasn't done that you know the shorts have a really for dissipated ... because the marque is the going up so much ... and that shows the lashing when one of ... the now ... and then when he's visiting the stores will deny the court at some point it is not a bad insurance policy that Scott value it's not like an option that has White declining value over time is just a ... piece of your for fall is sitting there may be one teacher for some of the portfolio ... has become a more tactical and more defensive in nature ... great